Big Name Insurance Companies Start Offering Crypto Protection Plans
Insurance Companies Start Offering Protection Plans to Cryptocurrency
Of late, established insurance companies, such as AIG and Allianz, have introduced protection plans for businesses in the digital currency sector. For example, AON, which controls half of the crypto-insurance sector recently revealed that insurances are establishing more plans for this industry. Also, the Marsh & McLennan insurance company claimed that most insurance companies started embracing virtual currencies at the beginning of 2018.
However, the premium rates charged to cryptocurrency companies are significantly higher than the standard rate. In some cases, they exceed the normal prices over five times. Furthermore, these plants have strict requirements, a factor that results in the restriction of several applicants. The high premium rates are imposed to counter the risks presented by trading in the digital currency sector. Earlier this year, the coin check trading platform lost a whopping $500 million worth of virtual currencies after hackers breached the network.
Chubb, as quoted in Bloomberg says that the company doesn’t underwrite insurance for virtual exchanges as well as wallets. On the other hand, XL was very specific that it was being keen when checking the risks associated with a digital currency exchanges and going through them one by one.
Notably, none of these insurance providers have revealed the details of their coverage plans. Nevertheless, most of them have openly expressed support for this concept. Impressively, the same technology that cryptocurrencies are built on, blockchain, is a remarkable innovation that is being considered “disruptive” in the insurance industry.